10-7

Suppose the market risk premium is 5% and the risk-free interest rate is 4%. Using the data in the table, calculate the expected return of investing in

a. Starbucks' stock.

b. Hershey's stock.

c. Autodesk's stock.

a. Starbuck's stock. The expected return of Starbucks stock is ______% (Round to two decimal places.)

b. Hershey's stock. The expected return of Hershey stock is _______% (Round to two decimal places.)

c. Autodesk's stock. The expected return of Autodesk stock is ______% (Round to two decimal places.)

Autodesk Starbucks 0.80 Hershey 0.33 Beta 1.72